Correlation Between Sable Offshore and Doubledown Interactive

Can any of the company-specific risk be diversified away by investing in both Sable Offshore and Doubledown Interactive at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining Sable Offshore and Doubledown Interactive into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Sable Offshore Corp and Doubledown Interactive Co, you can compare the effects of market volatilities on Sable Offshore and Doubledown Interactive and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in Sable Offshore with a short position of Doubledown Interactive. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sable Offshore and Doubledown Interactive.

Diversification Opportunities for Sable Offshore and Doubledown Interactive

0.14

Correlation Coefficient

Sable Offshore  Doubledown Interactive

Average diversification

The 3 months correlation between Sable and Doubledown is 0.14. Overlapping area represents the amount of risk that can be diversified away by holding Sable Offshore Corp and Doubledown Interactive Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Doubledown Interactive and Sable Offshore is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on Sable Offshore Corp are associated (or correlated) with Doubledown Interactive. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Doubledown Interactive has no effect on the direction of Sable Offshore i.e., Sable Offshore and Doubledown Interactive go up and down completely randomly.

Pair Corralation between Sable Offshore and Doubledown Interactive

Considering the 90-day investment horizon Sable Offshore Corp is expected to generate 1.42 times more return on investment than Doubledown Interactive. However, Sable Offshore is 1.42 times more volatile than Doubledown Interactive Co. It trades about -0.02 of its potential returns per unit of risk. Doubledown Interactive Co is currently generating about -0.17 per unit of risk. If you would invest  2,539  in Sable Offshore Corp on October 3, 2024 and sell it today you would lose (249.00) from holding Sable Offshore Corp or give up 9.81% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Insignificant
Accuracy	100.0%
Values	Daily Returns

Sable Offshore Corp  vs.  Doubledown Interactive Co

Sable Offshore Corp

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Sable Offshore Corp has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of rather sound basic indicators, Sable Offshore is not utilizing all of its potentials. The latest stock price tumult, may contribute to shorter-term losses for the shareholders.

Doubledown Interactive

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Doubledown Interactive Co has generated negative risk-adjusted returns adding no value to investors with long positions. Despite conflicting performance in the last few months, the Stock's fundamental indicators remain fairly strong which may send shares a bit higher in February 2025. The recent confusion may also be a sign of long-lasting up-swing for the firm traders.

Pair Trading with Sable Offshore and Doubledown Interactive

The main advantage of trading using opposite Sable Offshore and Doubledown Interactive positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sable Offshore position performs unexpectedly, Doubledown Interactive can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in Doubledown Interactive will offset losses from the drop in Doubledown Interactive's long position.

The idea behind Sable Offshore Corp and Doubledown Interactive Co pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.